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Power plants’ fuel costs seen at $25.4M in 6 months
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Posted on Apr 09 2012
During a six-month period, the Commonwealth Utilities Corp. projects to incur $25.454 million in fuel costs for its power plants.
From February through July 2012, CUC forecast to take delivery of 8.4 million gallons of fuel for power production. Average gallon per month is 1.4 million with estimated cost of more or less $4.2 million for each month.
The following is the projected fuel cost during the six-month period: February ($4.261 million); March ($4.251 million); April ($4.246 million); May ($4.236 million); June ($4.229 million); and July ($4.229 million).
Effective this month, CUC will collect a higher levelized energy adjustment clause, or LEAC rate, due to the continued rise in fuel prices.
The new rate is $0.32910 per kilowatt-hour—a 7.725 percent increase from the existing LEAC rate of $0.30550 that was approved last January.
According to Charles Warren, CUC chief financial officer, the impact of the new rate to average residential customers using 500 kWh is 7.73 percent, or $11.80 per month. To illustrate, an average customer’s billing of $152.75 for January 2012 will become $164.55 in April.
As for its impact on average businesses, Warren said there is really no average sized business account to compute the impact on, because businesses use anywhere from a few hundred kilowatt-hours monthly to hundreds of thousands of kilowatt-hours per month.
CUC earlier disclosed that projects an $8.9 million shortfall this fiscal year, of which $5.9 million is the projected operating loss in the power division alone.
Warren told Saipan Tribune that the LEAC rate adjustment this month is not intended to help address this expected shortfall as CUC will rely on its improved operating efficiencies and collections to address any operating losses this fiscal year.
